Though adviser funds popularity with Canadians shows no sign of weakening, ING Canada says it has found that investors want something more with global products and has launched a fund family that addresses that need.
Canadian investors are hungry for established, branded international products from a manager with a specific expertise, said Doug Paul, managing director of ING Funds.
The ING Advisor fund family, launched Tuesday, consists of 18 mutual funds seven Canadian and 11 international and is aimed at investors who buy through financial managers or stockbrokers.
Mr. Paul said it is not lost on ING that Canadian investors would rather go through financial advisers than financial managers or stockbrokers. They make 90% of their investment product purchases through financial advisers, according to the Investment Funds Institute, Toronto.
Dont get me wrong, he said. This marketplace isnt screaming that they need this fund family today, but still it is the right time to enter an unsaturated market.
The addition of ING Advisor makes ING Group, of Amsterdam, the third international bank to market adviser funds in Canada. Fidelity Investments and AIM Global Advisors Ltd. have sold them there since 1999.
ING is competing with major global players including Fidelity and AIM and with local players such as Royal Bank of Canada, Investors Group, and Mackenzie Financial Corp. Investors Group, of Winnipeg, is Canadas leader in advisory funds, with $41 billion of assets under management. It is followed by AIM, which has $35 billion after acquiring Torontos Trimark Investment Management in April 2000. Fidelity has $33 billion in its 41 Canadian advisory funds.
Kim Flood, director of external communications for Fidelity Investments Canadian unit, said the Canadian market is solid right now and is still looking for more global players.
Ms. Flood said 2000 was the strongest year for global investments for the Canadian investment dollar and that she expects international investments to retain their appeal. Under Canadian law, international investments can constitute up to 25% of an individuals retirement portfolio, and that cap will rise to 30% this quarter, Ms. Flood said.
Canada represents only 3% of the world market, and investors are really open-minded about looking beyond its borders for the right funds, she said.
Mr. Paul said that since one of Canadas major mutual fund providers, Mackenzie Financial Corp., announced it was up for sale in November, Canadian advisers have been looking to international bank and fund companies to diversify their investors portfolios.
Mackenzie, which has $37.1 billion of assets under management, responded to this by introducing a family of eight adviser funds Jan. 16, the Keystone Altamira Advisor Series Funds. It is being sold through independent financial advisers and include sector-specific funds as well as an international fund.
Mr. Paul said that, despite Mackenzies new products and the already well-positioned funds from Fidelity and AIM, INGs Advisor Funds can do well in this market.
ING Canada, Toronto, provides insurance, investment and banking services to 2.5 million customers in Canada. Worldwide, INGs asset management teams handle assets of $550 billion.
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